The Ohio Supreme Court will consider a medical malpractice lawsuit, a federal court’s question about the state securities law, and two disciplinary cases at next week’s oral arguments.

Refiling Timeline for Dismissed Federal Case
Indiana resident Pamela Portee sued the Cleveland Clinic and two doctors for medical malpractice after her elbow surgery in October 2012. Portee alleges that she had to have a second surgery because a nerve in her arm was severed during the first surgery.

She filed her lawsuit in federal court in Indiana. In a July 2014 dismissal of the case, the federal court concluded that it didn’t have jurisdiction to consider the matter because the clinic and the doctors didn’t have sufficient contacts in Indiana. Portee then filed the case in Cuyahoga County Common Pleas Court within a year of the federal court’s dismissal. The common pleas court granted summary judgment to the clinic, stating that Portee didn’t file within the one-year statute of limitations for medical malpractice claims. The Eighth District Court of Appeals, however, reversed the decision based on a state law, R.C. 2305.19, which allows the refiling of of certain lawsuits dismissed for reasons other than on the merits.

The clinic and the doctors have appealed to the Ohio Supreme Court, arguing in Portee v. Cleveland Clinic Foundation that the law doesn’t apply to a lawsuit filed in a “foreign state.” Portee counters that she had one year from the first dismissal to submit her case in state court, regardless of the type of court in which she first filed her lawsuit. Each side points to Ohio Supreme Court precedent to support their viewpoint.

Liability of Self-Directed IRAs Run by Trust Companies
Victims of Dayton-area Ponzi scheme operator William Apostelos are representatives of a class-action lawsuit against Apostelos in federal court. The investors are seeking to recover lost money from the trust companies that opened self-directed individual retirement accounts (IRAs) for them based on Apostelos’ advice.

Unlike a traditional IRA, a self-directed IRA owner directs the custodian to purchase assets, but the custodian doesn’t evaluate the risk of the asset and charges a fee lower than a traditional financial institution would to manage the IRA. The federal Securities and Exchange Commission has warned investors of the potential for fraudulent schemes with self-directed IRAs and that custodians “generally will not evaluate the quality or legitimacy of an investment or its promoters.”

A federal district court dismissed the investors’ lawsuit against the trust companies, finding that the “Ohio Securities Act” — R.C. 1707.43 — shields trusts from liability when the trusts are engaged in “normal commercial banking activities.” The investors in Boyd v. Kingdom Trust appealed the decision, arguing the law applies to anyone who “participated in or aided the seller in any way” in selling the fraudulent securities. The federal appeals court notes the exemption from liability has been applied to other financial institutions, but not to trust companies managing self-directed IRAs. The federal appeals court asks the Ohio Supreme Court to interpret whether the exemption in the Ohio Securities Act applies to trust companies acting as custodians of self-directed IRAs.

Professional Conduct Board Recommends Discipline for Two Attorneys
A former Mahoning County auditor is facing indefinite suspension from the practice of law for conduct related to the “Oakhill” influence-peddling scandal, which led to the criminal conviction of prominent public officials. In Mahoning Count Bar Association v. Sciortino, the partiesstipulated that former auditor Michael V. Sciortino committed four violations of the rules barring lawyers from committing illegal acts and engaging in conduct involving dishonesty, fraud, deceit, or misrepresentation. Sciortino has been serving an interim suspension since his April 2016 plea agreement. Sciortino objects to one of the conditions he would have to meet to be reinstated to the practice of law.

In Disciplinary Counsel v. Owens, the Ohio Board of Professional Conduct recommends a six-month suspension for a Delaware County attorney. His client had been jailed for not paying nearly $60,000 in spousal support, and the attorney used funds belonging to other clients to obtain this client’s release from jail. The attorney denies any wrongdoing, stating that the funds were expected imminently from the man’s new wife, that he explained the circumstances to the agency that handled the support payments, and that other issues were “payment snafus.” He asks either that the case be dismissed or that he receive the lesser sanction of a public reprimand.

Case Previews Released
Along with the descriptions provided in this article, the Supreme Court’s Office of Public Information today released in-depth previews of the central arguments in each case.

Oral Argument Details
The Court will consider the four cases at a one-day session on Tuesday, May 22. Oral arguments begin at 9 a.m. at the Thomas J. Moyer Ohio Judicial Center in Columbus. All arguments are streamed live online at sc.ohio.gov and broadcast live and archived on The Ohio Channel.